3 y.o. child with delayed speech development can now clearly say about 20 words, may say 2-word sentences, has some comprehension-show my your nose. but can he catch up with his peers? at age 2 his development level was that of a 1 y.o. child.

Hard to speculate: Speech & language development is a marker for intellect/development. Delays can occur in isolation from other skill sets but are often representative of potential. That said, with proper therapy & encouragement many kids go on to do quite well. This is a book you read a page at a time. You don't get to skip to the last page.

You never know: the most important thing at this point for that is opportunities provided/offered, and expectations.